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Keystone XL Pipeline: What Not to Like?

In 2008, TransCanada Keystone Pipeline, LP (Keystone) filed an application for a Presidential Permit with the Department of State to build and operate the Keystone XL Project. It would extend 1700-miles from an oil supply hub in Alberta, Canada to delivery points in Oklahoma and Texas, and would be capable of transporting up to 830,000 barrels per day. The estimated cost is $7 billion. Further information is available at this U.S. Department webpage,, and includes access to a three-page fact sheet.

The fact sheet includes a helpful timeline that includes major events and public outreach. In the process, the State Department consulted with at least eight other federal agencies.

The Obama administration announced last Thursday, November 10, that it was “delaying a decision” on the pipeline, as Washington Post opinion writer Robert Samuelson put it. Further details on the decision are available in articles at the Washington Post, the New York Times, and the Christian Science Monitor. The Post reporter described the delay this way:

“The move is the latest twist in a more-than-three-year review process that has evolved from a fairly routine decision within the federal bureaucracy to a very public debate over national energy policy. It pitted environmental activists and an array of citizens along the pipeline’s proposed route against business groups, oil companies and unions whose members would be employed as part of the $7 billion project.”

In his column, Samuelson explained:

"But environmentalists strongly oppose the project on two grounds: They object to oil-sands development that adds to greenhouse-gas emissions; and they argue that a spill from the pipeline might contaminate groundwater, particularly the Ogallala aquifer in Nebraska.

“There are two possible explanations for the delay — politics or incompetence in the original review. “This is all about politics and keeping a radical constituency, opposed to any and all oil and gas development, in the president’s camp in 2012,” said Jack N. Gerard, head of the American Petroleum Institute . Kerri-Ann Jones, the State Department official overseeing the review, denied that. “This is not a political decision,” she said. Although President Obama had conspicuously announced that he could overrule State, she said “there was no effort to influence our decision.”

“Was the original review deficient? In late summer, State released a voluminous environmental impact statement — running hundreds of pages — that gave a green light to the project. The study concluded that Canada would proceed with oil-sands development even if the pipeline were rejected. It would “seek alternative transportation systems to move oil to markets.” This, in effect, disposed of the greenhouse-gas argument; these emissions will occur anyway.”

If you don’t believe the decision was political, check this cartoon by the Houston Chronicle’s Nick Anderson. Below the cartoon, he comments:

“The move is the latest in a series of administration decisions pushing back thorny environmental matters beyond next November’s presidential election to try to avoid the heat from opposing interests — business lobbies or environmental and health advocates — and to find a political middle ground. President Obama delayed a review of the nation’s smog standard until 2013, pushed back offshore oil lease sales in the Arctic until at least 2015 and blocked new regulations for coal ash from power plants.”

At the American Interest blog, Via Meadia, Walter Russell Mead opines:

“The President may think he’s dodging a bullet by putting off his decision until after the election, but he has given the GOP a big pre-Christmas present, one that will go on giving as long as unemployment is a major political issue.

“The nexus of environmental policy and jobs has been a kind of Bermuda Triangle for this administration, where good intentions go awry and the best laid plans misfire. The failure of Solyndra demonstrated the poverty of “green jobs” initiatives, while the economic success of states like North Dakota and Texas are a testament to the continued effectiveness of old-style brown jobs. The President may be retreating from his failed green jobs plans, but still appears reluctant to embrace the more successful brown ones.

“If times are good by 2012, voters may vote their green hopes. If the economy is (as seems likely) still a problem, they will be voting their less verdant fears. This may be one can the White House will come to regret having kicked down the road.”

For some of the positions of those opposing the pipeline project, Paul Tullis has it here at the Huffington Post. Among supporters of the pipeline, there’s this piece in the Wall Street Journal and a post at the Heritage Foundation’s Foundry blog. In addition, Brandon Greife with the National Taxpayers Union has a detailed post at the NTU’s blog, Government Bytes.

Even the Washington Post on Sunday (appearing in the Wichita Fall, Texas Times Record News) editorialized in support of the pipeline. After writing, “Despite the passion among environmentalists against Keystone XL . . . Canada’s oil will come out of the ground, and someone somewhere will refine it and burn it,” specifically mentioning China, which the Post notes, “already has an $11 billion stake in Canadian oil production.”

At Hot Air, Jazz Shaw takes notes of the “fallout” from the President’s decision to “delay the approval” of the Keystone XL pipeline, and adds that a revised route will do nothing but cause a significant delay and add perhaps $2 billion in cost.

Finally, in a story posted earlier this evening at Canadian Business.com, titled, “Keystone XL prospects brighter after reroute, but experts stress other options, Lauren Krugel writes:

“TransCanada and Nebraska legislators said Monday they would work out a new route together, with the state conducting its own review. While TransCanada believes the move will expedite the process by as much as six months, the State Department is sticking to its early 2013 time frame for now.

“Lanny Pendill, an analyst with Edward Jones in St. Louis, said the development was positive, but not overwhelmingly so.

"Officially it has not changed the time line and this extended time line is what's putting the project at risk to competing proposals," he said.

“The Cushing, Okla, storage hub is brimming with crude, and a way to get that down to the Gulf is sorely needed now, he said.

"I think it's going to take more than one pipe. So to the extent, let's say, the decisions are delayed and shippers decide to jump to a competing proposal, I don't think that means that TransCanada doesn't build this pipe," he said.

"It may just mean that they're not the first pipe, because I think we're going to need more than one major pipe going to the Gulf coast anyway."

Perhaps the NTU’s Greife was correct after all to title his post, “America Needs Keystone Pipeline, Not Keystone Kops.


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